Network 300 has been placed into administration, with multi-distribution platform Thinc acquiring the business for an undisclosed sum.
Network 300 members attended a stormy meeting at London Heathrow's Marriott Hotel this week, where they were offered a lifeline deal from Thinc.
Thinc told advisers it would pay 30 per cent on pipeline business on top of anything paid by the administrators – speculatively quoted at 40 per cent – leaving intermediaries 30 per cent short.
Thinc also offered 24-hour turnround on registration and 15 per cent charges on all business transacted up to January 15.
Administrator BDO Stoy Hayward says the business – which has 278 RIs and 90 firms across the UK – did not hold sufficient capital and was not making a profit.
Network 300 parent Group 300 chief executive Chris Batten says the FSA forced it into administration because it would not allow the business to declare £1.2m spent on technologies as an intangible asset, hitting its solvency.
Thinc says it is negotiating with two more organisations with a view to signing deals by January 15.
Member Specialist Solutions director Ian Jones says: “This was something we thought we would encounter. Press releases from Group 300 suggested it was looking for resources. It is bad administration on our part not to have got out sooner.”
Thinc chief operating officer Simon Chamberlain says: “Most networks are scarred by administration issues historically. We will see a lot of IFA networks begin to fragment in the coming months.”